July 19, 2018 / 12:05 PM / a year ago

U.S. law firms weigh class action lawsuits over Danske share price drop

FILE PHOTO: A logo for Denmark's Danske Bank is seen at the SIBOS banking and financial conference in Toronto, Ontario, Canada October 19, 2017. Picture taken October 19, 2017. REUTERS/Chris Helgren/File Photo

COPENHAGEN (Reuters) - Three U.S. law firms have reached out to Danske Bank (DANSKE.CO) shareholders about possible class action lawsuits against the lender after a sharp fall in its shares sparked by a money laundering investigation.

Danske shares fell as much as 10 percent on Wednesday after it released disappointing second quarter results and said it would forgo up to 1.5 billion Danish crowns ($234 million) made in profits from “suspicious” transactions at its Estonian branch between 2007 and 2015.

The bank has admitted to flaws in its anti-money laundering controls in Estonia and has launched its own investigation, the results of which are expected in September.

Referring to Wednesday’s share price drop, New York-based Rosen Law Firm said in a statement it was looking into the possibility of launching a class action lawsuit on behalf of Danske’s shareholders over allegations the bank “may have issued materially misleading business information to the investing public.”

Danske’s spokesman Kenni Leth said in response: “It is our opinion that we have complied with the rules in connection with the publication of our interim financial statements.”

Two other U.S.-based shareholder rights law firms, Johnson Fistel and Schall Law Firm, also said they were investigating potential lawsuits against the bank and encouraged investors to contact them.

Reporting by Jacob Gronholt-Pedersen; editing by Jason Neely

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